Thailand’s Consumer Confidence Index (CCI) for May plunged to the lowest level in 42 months, due mainly to consumer concerns over rising oil prices as a direct result of the war in the Middle East, its impacts on the Thai economy and the rising cost of living.
Thanawat Pholvichai, rector of the University of the Thai Chamber of Commerce and advisory chief of its Economic and Business Forecast Centre, said today that the CCI for May dropped from 50.6 to 49.5, which is the lowest in three and a half years.
He noted, though, that the survey upon which the CCI is based was undertaken before the launch of the ‘Thai Chuay Thai Plus’ scheme on June 1, adding that he expects the index to improve this month through September because the scheme will boost the amount of money in circulation by between 50 and 60 billion baht per month.
Thanawat thinks that the Thai economy has gone through its lowest point, but the economic growth graph remains K-shaped, with uneven growth across the country and sectors.
Nonetheless, he forecasts that Thai GDP growth for the whole of this year will register 1.6-2%, with a good probability that it could exceed 2%, depending on the impacts of the Thai Chuay Thai Plus scheme and developments in the Middle East.
Meanwhile, Wachira Koonthaveethep, the assistant rector of the university’s strategic affairs, said that the business confidence index for May dropped from 42.2 to 41.7, representing three consecutive months of decline, due mainly to high diesel prices which have driven up production costs.
Employment has also fallen sharply, with mass layoffs of workers and a slowdown in new hiring, he said, adding that the private sector has sought help from the government by stabilising diesel and gas prices and introducing debt moratoria or other relief measures.
